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Monday, June 30, 2008

FDR and Obama

The controversy du last week was the "Presidential" Seal that Senator Barack Obama used at a campaign event. Tempest in a teapot.
But did you see anything familiar about the modification? Neither did I. But historians recognized the symbol of one of President Franklin Roosevelt's largest programs to combat the Depression of the 30s. Just the stylized eagle.
The NRA was to improve the economy by making it more efficient by collectivizing it. Yes, collectivizing. In the 1930s they did have the lesson of the complete failure of the Soviet Union's and China's collective efforts. FDR assigned two of his top aids - Rex Tugwell and ? - to organize it.
And organize it they did. From top to bottom and east to west they encouraged small businesses to join together for efficiency. Forming companies, trading associations, marketing coops and ... cartels - legal cartels. There were price and other controls - shortening hours of work, raising wages arbitrarily. There were codes for nearly everything including hair tonic!!
It is estimated that it increased the cost of doing business by 40%. In the six months after the law took effect, industrial production dropped 25 percent.
The organization included enforcement. General Hugh Johnson was assigned to encourage the reluctant. Did he know the difference between encouraging and forcing? Violators were labeled enemies of the state for not displaying the Blue Eagle. Boycotts were allowed and encouraged.

A New Jersey tailor named Jack Magid was arrested and sent to jail for the "crime" of pressing a suit of clothes for 35 cents rather than the NRA-inspired "Tailor’s Code" of 40 cents.

But his rewards for those who joined was probably worse. Goon squads roamed the cities looking for violations and the penalties were Soviet, including jail and boycotts. Enforcement squads were allowed to break down doors without a warrant to find people violating the codes against .... working at night.
To learn more read Amity Schlaes' book The Forgotten Man
Tip: American Thinker
Have you noticed I am writing more? During my medical leave I have more time for blogging. And I am enjoying it. I want to investigate the effects of the NRA and other FDR stimulus programs. There was a second dip in 1937 that was close to the one that called for all of this.